A Capacity Alternative Has an Initial Cost of $50,000 and Cash

question 85

Multiple Choice

A capacity alternative has an initial cost of $50,000 and cash flow of $20,000 for each of the next four years.If the cost of capital is 5 percent,what is the approximate net present value of this investment?

• A)$20,920
• B)$26,160
• C)$49,840
• D)$70,920
• E)$106,990

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Definitions:

Sensorimotor Development

The stage in Jean Piaget's theory of cognitive development, from birth to about age 2, where infants learn about the world through their sensory and motor interactions.

Sensorimotor Stage

The first of Piaget's four stages of cognitive development, from birth to about 2 years, where infants learn about the world through basic actions such as sucking, grasping, looking, and listening.

Deliberate

Intentional or carefully considered action or decision.

Sensorimotor Stage

The first stage of cognitive development according to Jean Piaget, where infants learn about the world through their senses and motor activities.